British vehicle management group Leasedrive Velo has changed private equity owners in an £80m secondary deal between vendor Lyceum Capital and buyer LDC.
The Wokingham-based business provides fleet management, contract hire plus short and mid-term vehicle rentals for a host of companies, including PricewaterhouseCoopers, British American Tobacco, Samsung, and John Lewis Partnership.
The sale by Lyceum ends an investment period which began in 2004 when it acquired a debt only BIMBO of Leasedrive. In January 2007, it was merged with Velo, a UK fleet management business it had acquired in 2003.
Lyceum Partner, Dan Adler, said: “The merger between Leasedrive and Velo at the beginning of January 2007 demonstrated the strength of combining two high quality mid-sized players to create a market leader in a niche sector. Merging companies is never simple as it involves many factors, but having identified the synergies between the two companies, the merger bedded down well.”
Since 2003, the Velo has increased profits fivefold through organic growth, expansion of the range of services and the merger with Leasedrive.
The new owner, LDC, has taken a majority stake, with Royal Bank of Scotland providing debt and asset finance facilities.
Kevan Leggett, managing director of LDC, said: “Leasedrive Velo has built a quality reputation which is a key differentiator in this competitive and growing market. We were particularly attracted to its differing sources of revenues which provide the business with significant downside protection.”
The strategy for the future will see Leasedrive Velo focus on growing the contract hire and fleet management services side of the business, in addition to expanding the short and mid-term rental business. In a statement, the company said this will increase its £62m turnover by over a third during the next two years and increase its share of the £10bn fleet management service market.
“It has built a high quality client base not only by developing unique technology platforms and innovative products, but by providing a level of service and support which is far higher than the industry standard,” continues Legget.
“We’re backing the outstanding management team that is responsible for this and which has already demonstrated its ability to build shareholder value by successfully delivering on two transactions, including a complex merger.”